Energy Bill [HL]

Debate between Lord Whitty and Lord Bourne of Aberystwyth

Monday 14th September 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, I appreciate that point. On the clause as set out, I have made it clear that we will not come forward with this additional obligation. The manifesto is absolutely clear that there will be no power sector target. That is the position of the Government.

[Lord Whitty]

My Lords, if I understand that right it is very disappointing. I can understand the objection, or at least the querying by the noble Lord, Lord Deben, as to whether we need a detailed mechanism for setting carbon intensity coefficients by supply, but he argued very persuasively, and has done before, for a decarbonisation target for 2030. That is why that was written into the 2013 Act and why there was an expectation and general indication from the Minister’s predecessors that there would be a target set in 2016, but only in the context of the carbon budget, which they are obliged by the Climate Change Act to come forward with. I did not accept that argument, but I understood it in terms of the timing. There was some considerable debate about that during what became the passage of the 2013 Act.

It is very disappointing, not only to us in this House but to the various industry operators, including the supply companies, that there seems to be an abandonment of that commitment in what the Minister has interpreted from the Conservative Party manifesto. As I well know, manifestos are pretty flexible things. I hope that he can consult with his colleagues as to whether it actually meant that, or whether there was some more room—

[Lord Whitty]

My Lords, I am not quite such a conscientious and diligent reader of the manifestos of various parties—even my own—as the noble Lord, Lord Teverson. The best thing we can ask the Minister to do is to go back and talk to his colleagues—whether it was in the manifesto or not—about whether they are definitely now not going ahead with what was allowed for in the 2013 Act. If that is the case, there are ramifications. I understand why the Minister is opposed to the mechanism proposed in the amendment. I would have thought that having set the 2030 target for decarbonisation would be a useful addition to the armoury, as the Committee on Climate Change and the noble Lord, Lord Deben, advocated. If the Minister feels that that would be too much interference in the market mechanisms, I understand that. It would still be up to the supply companies how they met that obligation and what kind of technologies and contracts they entered into. The market is still operating there. I understand and accept that the Minister is not prepared to go along with that.

[Lord Bourne of Aberystwyth]

To be helpful, in view of the fact that there is a degree of uncertainty about what the manifesto says specifically—not least with me—I am happy to go back and have a look at it. We can come back to it on Report to ensure that I have understood the position correctly. I undertake to do that and we can pick it up on Report if that is helpful.

[Lord Whitty]

My Lords, that was very generous of the Minister. I thank him very much, as I think the Committee will as a whole. Before I withdraw the amendment, I will just comment on something that the Minister said on markets and nationalisation. When the then Energy Bill of 2013 first came before us, the noble Lord’s colleague, the noble Lord, Lord Lawson of Blaby, described it as “Gosplan”. There is something in that. There is nothing from any element in the Labour Party that goes as far as that. I beg to ask leave to withdraw the amendment.

Energy Bill [HL]

Debate between Lord Whitty and Lord Bourne of Aberystwyth

Monday 7th September 2015 Lords Chamber

[Lord Whitty (Lab)]

My Lords, I have two amendments in this group, but I also want to apologise to the Committee because, due to my attendance at my Select Committee, I was unable to be here for the previous debate, during which, as my noble friend said, the case was made for ensuring that the OGA—while it may well have principal objectives—has to operate in the context of wider energy policies. Issues of climate change, energy security and affordability are relevant to how the OGA fulfils its main functions. Indeed, if its main function is in terms of maximum economic recovery, what happens on those other dimensions of energy policy affects the actual economics in MER. Therefore, it is important that the OGA, as set out in the earlier clauses, has some regard to those broader objectives of energy policy. It is also important that the Secretary of State can intervene in those areas.

Amendment 13 would allow the Secretary of State to give directions where it would be necessary to meet the terms of the Climate Change Act and the budgets promulgated under that Act. Amendment 15 relates to the Committee’s discussion before the break about carbon capture and storage, so that directions could relate explicitly to the storage of gas and oil and the storage of carbon dioxide as part of a carbon capture and storage scheme. The amendments previously discussed relating to Clause 4 need to be complemented with the ability of the Secretary of State to intervene on those same subjects. That is what these amendments would do.

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, I shall speak to the amendments in this group and I thank noble Lords who have participated in the debate for speaking to their amendments. Amendments 12 to 15 relate to Clause 5 of Part 1 of the Bill, which concerns directions the Secretary of State may give to the Oil and Gas Authority. As the noble Baroness, Lady Worthington, said at the outset of our consideration in Committee, most of what we are looking at in the non-government amendments relates to carbon capture and storage. That is certainly a point well made. As I have indicated, we have undertaken that we will look at the issues relating to carbon capture and storage prior to Report.

As has been said, Clause 5 gives the Secretary of State power to direct the Oil and Gas Authority in the exercise of its functions if the Secretary of State considers the directions in the interest of national security or otherwise in the public interest. The noble Baroness, Lady Worthington, asked for examples of that and I will try to provide a couple. First, if a licence is applied for by a person who is suspected of corruption and whose possession of a licence the Secretary of State thinks would lead to reputational embarrassment or political damage to the United Kingdom, the intention is that the Secretary of State should be able to direct the Oil and Gas Authority not to issue a licence to such a person.

Secondly, another instance may be if there are other competing uses for a particular area of the seabed in respect of which the Oil and Gas Authority may grant licences. The intention then is that the Secretary of State should be able to give a direction to the Oil and Gas Authority as to over which areas it should or should not exercise its licensing powers so as not to prejudice those other uses.

Finally, another example may be that the Secretary of State should be able to direct the Oil and Gas Authority not to grant further consents for development in the face of public concern about the scientific evidence in relation to the methods used or a change in government policy. Clearly, that is not an exclusive list but those are some situations that may be covered by it.

The amendment makes it clear that the power in Clause 5 can extend to the Oil and Gas Authority’s functions in relation to the carbon capture and storage sector. We believe that it is unnecessary to do this because the Secretary of State’s power to give directions to the Oil and Gas Authority as to the exercise of its functions already applies to the carbon capture and storage sector in so far as it is in the ambit of the Bill.

--- Later in debate ---

[Lord Whitty]

I do not believe that either my amendment or the other amendments intend to designate the OGA as a drafter or an enforcer of environmental legislation. They seek to ensure that anything the OGA does will not jeopardise—preferably, they would further—the broader objectives of the Government. This does not mean that it is a regulator; rather, that the Secretary of State would have the ability to intervene if some of the economic decisions taken by the OGA jeopardise its legal obligations under the domestic climate change Acts, or indeed jeopardise its international legal obligations under EU or any global climate change agreements. We are not arguing that the OGA should be an environmental regulator.

[Lord Bourne of Aberystwyth]

I am grateful to the noble Lord for that clarification. We will have another look at the position, and indeed I am probably using the term “environmental regulator” in something of a shorthand sense. We have legal concerns on this, but I undertake to take a second look and possibly we will come back to it on Report.

In the light of my comments and the undertakings that I have made previously, I respectfully ask the noble Baroness to withdraw the amendment.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

I know that my noble friend was not seeking to be difficult or disruptive in any way; I know her too well to think that. I am happy to write further on the issue, but if the company goes into liquidation, basically, proceedings under the Insolvency Act would apply, and the liquidator—I believe this is the case, although this is on the hoof—would then have to act in response to any request from the Oil and Gas Authority to make the samples or the information available. However, I will write to my noble friend on that issue and will ensure that other noble Lords are copied in as well.

[Lord Whitty]

My Lords, I am grateful to the Minister for such a detailed response to my amendments and the others in this group. Obviously, I will have a very close look at what he said in Hansard and will consult those who were concerned about these issues. Certainly there is concern that the overlap between “principal objective” and “petroleum-related” could exclude things that were not currently related to the extraction—or exploration of the extraction—of petroleum, and therefore could exclude carbon capture and storage. However, the Minister has given various reassurances on that, some of which I will require some legal advice on. I am quite happy to arrange for a meeting with him or his officials. However, I repeat that I am very grateful that he has taken these amendments seriously and I hope that we can reach some accommodation on this. I beg leave to withdraw the amendment.

Electricity Supply: Decarbonisation

Debate between Lord Whitty and Lord Bourne of Aberystwyth

Monday 15th June 2015 Lords Chamber

[Lord Whitty]

To ask Her Majesty’s Government what steps they are taking to decarbonise the electricity supply system in the United Kingdom, with which targets and over what timetable.

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, we are committed to doing our part to tackle climate change in line with the Climate Change Act. We want to do this as cost-effectively as possible to ensure that our energy is secure and affordable as well as lower-carbon.

[Lord Whitty (Lab)]

My Lords, I thank the Minister for that reply. I am pleased to have my first encounter with him in his new position. However, I hope that he will ask his officials to give him slightly more detailed Answers. The Question refers to a timetable, and we need action on a number of fronts. By what date does he expect the coal-fired power stations to be phased out—that was a commitment of all three parties before the election—and when does he expect the Hinkley Point B power station to come on-stream to provide us with a new source of nuclear power?

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Lord for that welcome; I am sure it will be the start of a beautiful friendship, to revisit “Casablanca”. We anticipate that by 2025, unabated coal will account for only 1% of total generation. In relation to Hinkley B, which he also mentioned, the answer is 2023.